NEWS
Ministers ‘not to blame’ for West Coast errors – Laidlaw M
inisters and senior civil servants were not to blame for the West Coast franchising
fiasco, according to Sam Laidlaw’s report, published on December 6, which chronicles a series of “serious and regrettable errors” at the DfT.
Laidlaw (pictured top right) blames a mix of technical errors and flaws in the financial modelling process and the Subordinated Loan Facility sizing process, as well as contributory causes such as a lack of transparency, inadequate planning and preparation, and a “complex and confusing organisational structure with weak quality assurance and insufficient governance oversight”.
The report was labelled “uncomfortable reading” by transport secretary Patrick McLoughlin, while the DfT has pledged a series of improvements, including ensuring future competitions are delivered at a good pace based on sound planning, a clear timeline, rigorous management and the right quality assurance, as well as creating a simpler and clearer structure and governance process. A single director general with responsibility for all rail policy and franchising will be appointed.
Laidlaw, chief executive of Centrica and a DfT non-executive board member, was asked by McLoughlin to investigate what went wrong in the franchising process, which initially took the
franchise off Virgin and handed it to FirstGroup. But following the emergence of significant errors in the calculation of financial guarantees by bidders, the process was scrapped and Virgin has been given a contract extension while a new round of bidding takes place.
Laidlaw told the Transport Select Committee in an evidence session on December 18 that senior civil servants were kept apart, which meant that there was “no-one to escalate concerns to”. Laidlaw called for the policy of anonymising bids to be scrapped.
He said ministers had to “satisfy themselves that due process is being followed … and that it has good integrity and good transparency”.
He said: “What happened here did not conform with those principles – but not for lack of questioning from the ministers.
“This was a sequence of errors. There was no ownership and no obvious route to escalate concerns. This process had to be done against the clock and that sense of urgency made people more reluctant to escalate concerns.”
Transport committee chair Louise Ellman MP said: “It’s astonishing that nobody was in charge and no senior officials were present when critical decisions were made, with disastrous consequences.
Hitachi IEP extension contract may be in jeopardy T
he UK Government may not sign off on the second part of the InterCity Express
Programme contract with Hitachi, it has emerged.
In 2012, Hitachi secured an initial order for 596 carriages worth £34.5bn, with the option for a further 270 vehicles.
The financing of the order was spilt into two parts, with just under half still awaiting financial close, due this year.
From 2018, the 596 new carriages will replace the InterCity 125 fleet.
It was envisioned that the option for 270 extra carriages would replace the InterCity 225 trains from 2020. However, the
4 | rail technology magazine Dec/Jan 13
Government is considering alternative options, the Financial Times has reported.
Simon Burns, the UK rail minister, told the newspaper that
the Government remained
“committed to providing a modern intercity train fleet for the ECML”. However, he warned that “as part of [the Government’s] commitment to secure the best deal for passengers and taxpayers, we are also looking at a range of options to modernise the rest of East Coast’s
“I think the committee has
exposed the
appalling inadequacies of the department, the way it was structured and the way it was run. Ultimately the minister has to be responsible for the running of the department.”
DfT permanent secretary Philip Rutnam (pictured below) said: “There is no question that this has been a serious blow for the Department and I am determined that we learn everything we can from this episode.
“We will implement all of Mr Laidlaw’s recommendations, and go further, to ensure we have the right set of skills, support and training to ensure failures like this do not happen again.”
The other, wider review into franchising policy more widely, by Richard Brown, is expected to be published in the coming weeks.
existing fleet”. One of these options includes Eversholt Rail, owner of the InterCity 225 fleet, offering to invest £120m to refurbish and lease the fleet. It has been suggested that this could be done at a third of the cost of the new IEP Super Express trains.
It has produced concept videos and artwork showing how refurbished Mark 4 carriages could look for the East Coast Main Line in the future (see images below).
© PA Wire
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